As Vietnam enters a new phase of fiscal reform, a series of major tax and tax administration changes will take effect from 1 July 2025 and 1 January 2026, reshaping compliance obligations for both domestic and foreign businesses.

Based on official materials from the Ministry of Finance’s 2025 Tax Policy Dialogue, THE LAM LAW LLC – Your legal need, Our Mission would like to share highlights the following key legal developments:

⚖️ 1. VAT Law Reform – Broader Tax Base, Stricter Compliance
🔹Expansion of VAT taxpayers to foreign digital service providers and e-commerce platforms.

🔹Narrowing of VAT-exempt goods and services to align with international practices.

🔹Increased revenue thresholds for small businesses (up to VND 500 million/year from 2026).

🔹Tightened rules on VAT deduction and refund, with enhanced anti-fraud safeguards.

 2. E-Commerce & Digital Economy: Higher Withholding Responsibilities
🔹E-commerce platforms with payment functions are required to withhold, declare, and pay taxes on behalf of sellers.

🔹Non-resident suppliers must register and pay taxes in Vietnam, reinforcing cross-border tax enforcement.

📉 3. VAT Rate Reduction Extended
🔹The 2% VAT reduction (from 10% to 8%) is extended until 31 December 2026, covering a broader range of goods and services.

🔹Accurate invoicing and classification remain critical to avoid post-audit risks.

🧾 4. Tax Administration Law: Increased Enforcement Powers
🔹Stronger measures against non-compliance, including exit bans for tax debts above statutory thresholds.

🔹Extended timelines for supplementary tax filings (up to 10 years before audit/inspection).

🌍 5. Corporate Tax & Global Minimum Tax (Pillar Two)
🔹Implementation of OECD BEPS Pillar Two rules, introducing additional corporate income tax for large multinational groups.

🔹New excise tax policies targeting sugary beverages and tobacco products in line with public policy goals.

📌 Legal Takeaway
These reforms signal a clear policy direction toward greater transparency, digitalization, and international tax alignment. Businesses—particularly in FDI, technology, e-commerce, and cross-border operations—should proactively review their tax structures, contracts, and compliance systems.

📎 This update is for general information purposes only and does not constitute legal or tax advice.

Link PDF: Ministry of Finance’s 2025 Tax Policy Dialogue

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